Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

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HRnetgroup Limited / Equity Capital Markets

HRnet Group plans to raise up to US$125m in its IPO.  The company has already garnered considerable interest from marquee long only investors with Temasek making a pre-IPO investment and Fidelity and Aberdeen coming in as cornerstones.The headline numbers reported by the company appear good especially in the context of the moribund employment situation in Singapore, which is its primary market. However, revenue growth was non-existent last year and the bottom line has been propped with via an increasing share of government subsidies which have already been cut down in 2017.Moreover, the company has paid our S$159m worth of dividends to shareholders over FY14-16 and still remains net cash, which seems to imply that even though the company is raising fresh money in the listing, the IPO is more about providing liquidity to employees rather than raising cash to acquire new businesses, as is being indicated.Nonetheless, the company generates a lot of cash, as the above dividend payments imply, is asset light, and has a good track record. In addition, after adjusting for its cash holdings post the IPO, it doesn't appear very expensive either.

HRnet Group plans to raise up to US$125m in its IPO.  The company has already garnered considerable interest from marquee long only investors with Temasek making a pre-IPO investment and Fidelity and Aberdeen coming in as cornerstones.The headline numbers reported by the company appear good especially in the context of the moribund employment situation in Singapore, which is its primary market. However, revenue growth was non-existent last year and the bottom line has been propped with via an increasing share of government subsidies which have already been cut down in 2017.Moreover, the company has paid our S$159m worth of dividends to shareholders over FY14-16 and still remains net cash, which seems to imply that even though the company is raising fresh money in the listing, the IPO is more about providing liquidity to employees rather than raising cash to acquire new businesses, as is being indicated.Nonetheless, the company generates a lot of cash, as the above dividend payments imply, is asset light, and has a good track record. In addition, after adjusting for its cash holdings post the IPO, it doesn't appear very expensive either.

HRnet Group IPO - Not Very Exciting but It's Not Very Expensive

Singapore

HRnetgroup Limited provides consultancy services. The Company offers talent acquisition, performance consultancy, soft skills development, and graduate training services. HRnetgroup serves automotive, retail, industrial, technology, finance, and construction sectors worldwide.

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HRnetgroup Limited (HRNET SP)

HRnet Group IPO - Not Very Exciting but It's Not Very Expensive

HRnet Group plans to raise up to US$125m in its IPO. The company has already garnered considerable interest from marquee long only investors with...

Sumeet Singh

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52-week Range

Market Cap (USDm)

P/E

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